Morgan Stanley

Stu Bohart to Become Head of Alternative Investments at Morgan Stanley Investment Management

May 3, 2006

Former Head of Firm's Industry-Leading Prime Brokerage Business Brings Extensive Experience with Hedge Funds

New York —

Morgan Stanley (NYSE: MS) today announced that Stu Bohart, 40, who most recently headed the Firm's industry-leading prime brokerage business, will become Head of Alternative Investments at Morgan Stanley Investment Management. He will report to Owen Thomas, President and Chief Operating Officer of Morgan Stanley Investment Management. Stu Bohart joined Morgan Stanley in 1997 as a portfolio manager in asset management. His experience also includes trading and portfolio management positions at Bankers Trust and Harvard University's endowment.

Morgan Stanley's prime brokerage leadership team — including Rich Portogallo, who is also Head of the U.S. Equity Division, will continue to run the global prime brokerage business. The regional management includes: Pat Mortimer, Head of U.S. Prime Brokerage; Warren Holmes and Jack Inglis, Co-Heads of Europe Prime Brokerage; and Kurt Baker, Head of Asia Prime Brokerage.

Bob Scully, Co-President of Morgan Stanley, said, "Given his extensive experience working with hedge funds and alternative investments, Stu Bohart is the ideal candidate to help us realize the significant growth opportunities we see in the alterative investment business. Over the past eight months, Owen Thomas has taken a number of important steps to transform and grow our investment management franchise. Under his leadership, we have made major investments in hiring new talent and seeding new alternative investment products, and we now have a strong foundation on which Stu can continue to build our alternatives business."

Zoe Cruz, Co-President of Morgan Stanley, said, "Stu Bohart is highly regarded for his role in helping us evolve our international footprint in our industry-leading prime brokerage business, and his appointment reflects Morgan Stanley's ability to leverage our capabilities and experience across the Firm. We have a strong and deep leadership team in Prime Brokerage, and with Rich Portogallo and his team, we have the right people in place to reinforce and extend our leadership in this important business."

Mr. Thomas said, "We have taken numerous steps to begin realizing the opportunities we see in the alternative investment business. We have attracted key new talent from inside and outside the Firm, launched new alternative products, and won mandates for alternative investments with pension plans around the globe. There is a great deal of work to be done in our alternative investment business, but we are confident that Stu will provide the leadership and perspective we need to continue building this important part of our asset management franchise."

Mr. Bohart became Head of Prime Brokerage in 2005 and prior to that, he was Head of International Prime Brokerage since 2003 and has helped Morgan Stanley gain market share while establishing a reputation as the top prime broker in the industry. Two industry publications, Alpha and Global Custodian, recently ranked Morgan Stanley the top prime broker overall in surveys of their hedge fund readership, measuring categories such as client service, operations, reporting and technology, and securities lending.

Mr. Bohart said, "In a relatively short period of time, Owen Thomas has built an outstanding team and has generated significant momentum in Morgan Stanley's asset management business. Early on, he identified alternative investments as a major opportunity for growth and a key sector in which Morgan Stanley's intellectual capital can provide a significant competitive advantage. I am looking forward to working with Owen and the rest of the MSIM team to realize that opportunity and grow this important business."

Morgan Stanley is a global financial services firm and a market leader in securities, investment management, and credit services. With more than 600 offices in 30 countries, Morgan Stanley connects people, ideas and capital to help clients achieve their financial aspirations.

Note to Editors:

Stuart Bohart

Stuart Bohart is a Managing Director and Head of Alternative Investments at Morgan Stanley Investment Management. He joined Morgan Stanley in 1997 as a portfolio manager in the investment management business, where he co-managed a global multi-strategy equity fund. He subsequently headed risk management for the Firm's prime brokerage and stock loan businesses. He became head of International Prime Brokerage in 2003 and global head in Prime Brokerage 2005. He was appointed Head of Alternative Investments in 2006.

Stuart's previous experience includes portfolio management and trading positions at Harvard University's endowment fund, Bankers Trust, and FrontPoint Partners. Stuart graduated from Northwestern University in 1989 with dual degrees in Economics and Asian Studies.

Morgan Stanley Investment Management

Morgan Stanley Investment Management, with $442 billion in assets under management and more than 400 investment professionals around the world, is one of the 20 largest businesses in the highly fragmented global investment management industry. The division, which serves both institutional and individual clients, contributed more than 14% percent of Morgan Stanley's profit before taxes in 2005.

The division has three distinct sets of clients:

  • Institutional clients, including 401(k)/defined contribution plans, endowments, foundations, pension funds, corporations, governments, and high-net-worth individuals;
  • Individual investors who own Morgan Stanley funds managed by Morgan Stanley Investment Advisors; and
  • Investors who make investments through other brokerage firms, banks and financial planners via Van Kampen Investments, a wholly owned subsidiary.
As of February 28, 2006, assets under management or supervision included $247 billion in institutional assets and $195 billion in retail assets.